Infrastructure investment drives economy: Pridiyathorn

The economy will pick up pace in the second half of this year after infrastructure projects aimed at improving rail, road and mass transit systems are approved, Pridiyathorn Devakula said on Thursday.

The economic adviser to the National Council for Peace and Order (NCPO) was upbeat about better economic growth for the rest of the year as new investment will rise and people will spend more.

Investors are more confident as infrastructure plans take shape, MR Pridiyathorn said in his keynote speech at the Post Today Expo 2014 forum.

MR Pridiyathorn is chairman of Post Publishing Plc, which publishes the Post Today, Bangkok Post and M2F newspapers.

The military regime approved the infrastructure projects on Tuesday. They mainly focus on the train and mass transit systems.

The construction of the dual track routes and two news lines alone account for 858 billion baht. It also gave approval on mass transit lines linking inner Bangkok and satellite areas.

The new lines, with the wider 1.435 meter standard gauge, can serve high-speed trains in the future. They will link with train lines from southern China. The existing lines use the one-metre gauge.

The clear investment direction gave investors and financial institutions confidence, he said, adding the real estate sector will flourish along the train routes.

Payments to farmers joining the rice-pledging scheme and other stimulus measures will boost spending, MR Pridiyathorn said.

His upbeat tone is in line with the Finance Ministry, which expected a better outlook for Thailand in the last six months as political stability will move the economy out of negative territory.

The economy plunged in the first half of this year due to the political unrest dragging on from late last year.

The Finance Ministry estimated the economy contracted 0.4% in the first half of this year over the same period last year due to the political crisis which sapped local and foreign confidence in Thailand.

The ministry on Wednesday slashed its forecast for the entire year to 2% from its projection of 2.6% in March.

The Centre for Economic and Business Forecasting at the University of the Thai Chamber of Commerce also presented a forcast along the lines of the ministry's.

Centre director Thanawat Pholvichai expected the economy would end between 2% and 2.5% up this year, riding on rapid growth in the second half to offset the slump in the first half.

He predicted a faster pace for the economy next year.

Source: Bangkok Post